explain why a firm is not able to deal with an externality
Homework Answers
externality is defined as the consumption or production done by
any party, which effects the third party also is called
externality.
There can be two types of externality. Both negative and
positive.
A positive externality is when marginal social benefit is more than
private benefits.
a negative externality is when social cost is more than private
cost.
As shown above, externality is an automatic process. In simple
words, if there is any consumer or production of any good and
services by any individual or firm is done then these externality
will come into existence automatically. So, firms are not able to
deal with externality. They cant vanish the externality totally of
they want to produce goods.
explain how a firm is able to deal with both types of costs.
explain how a firm is able to deal with both types of costs.
"Our firm is able to provide a better deal for consumers because it is 'non-profit'. Our competitors have to add profits...
"Our firm is able to provide a better deal for consumers because it is 'non-profit'. Our competitors have to add profits on to their costs." Does this make any sense? Does a non-profit firm not make profit or losses?
Explain why, in a market with negative externality, too much output (more than the efficient amount)...
Explain why, in a market with negative externality, too much output (more than the efficient amount) is produced and sold and positive externality, too little output (less than the efficient amount) is produced and sold. If you use a diagram in your answer, make that diagram large and label all axes, curves, and points.
Explain why, in a market with negative externality, too much output (more than the efficient amount)...
Explain why, in a market with negative externality, too much output (more than the efficient amount) is produced and sold and positive externality, too little output (less than the efficient amount) is produced and sold. If you use a diagram in your answer, make that diagram large and label all axes, curves, and points.
6. What is a network externality? And why might goods that exhibit this externality be more...
6. What is a network externality? And why might goods that exhibit this externality be more likely to be provided by monopoly suppliers
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Discuss Truman’s domestic agenda (Fair Deal) and explain how and why it had limited success?
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Explain why market governance works best when the essential attributes of a financial deal are incorporated into the funding cost associate with the risk borne by investors? (typed)
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Explain how this is a form of price discrimination and how the firm is able to extract more profits because of this system. 7) You are in charge of a large retail electronics store. There are currently 10,000 Sony LED TVs in the warehouse. You have been asked by the corporate office to devise a system of extracting the maximum profit per customer, while still selling the full inventory. The price that the store paid for each TV is $400....
Analyze why a perfectly competitive firm is only able to earn normal profits in the long...
Analyze why a perfectly competitive firm is only able to earn normal profits in the long run compared to the short run.
4. Private Policies toward Externality a. Name three private policies toward externality b. Explain two policies...
4. Private Policies toward Externality a. Name three private policies toward externality b. Explain two policies of your choice
Explain why, in a market with negative externality, too much output (more than the efficient amount) is produced and sold and positive externality, too little output (less than the efficient amount) is produced and sold. If you use a diagram in your answer, make that diagram large and label all axes, curves, and points.
6. What is a network externality? And why might goods that exhibit this externality be more likely to be provided by monopoly suppliers
Explain how this is a form of price discrimination and how the firm is able to extract more profits because of this system. 7) You are in charge of a large retail electronics store. There are currently 10,000 Sony LED TVs in the warehouse. You have been asked by the corporate office to devise a system of extracting the maximum profit per customer, while still selling the full inventory. The price that the store paid for each TV is $400....
4. Private Policies toward Externality a. Name three private policies toward externality b. Explain two policies of your choice
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